When to Get Homeowners Insurance on a New Construction Home
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The short answer: your homeowners policy needs to be active by the day you close and take ownership, not during the build itself. While Sharp Homes is constructing your home, the builder carries the insurance that protects the project. Your job is to line up your homeowners policy so it takes effect at closing without a gap.
That said, the exact timing your lender wants can vary, so this guide explains who covers what during the build, when your policy should start, and how to avoid the two mistakes buyers make: starting coverage too early and paying for it twice, or starting too late and closing without proof of insurance in hand.
Your homeowners policy needs to be active on your closing date, not during construction. While Sharp Homes builds, the builder’s risk policy covers the project. Line up your policy to take effect at closing so there is no gap and no double payment.
Who Insures the Home During Construction?
During the build, you do not need your own homeowners policy. Sharp Homes carries a builder’s risk policy that covers the home while it is under construction. That coverage protects the structure and materials during the build, so you are not paying for homeowners insurance on a house you cannot live in yet.
Your coverage picks up where the builder’s leaves off: at closing, when ownership transfers to you.
| Phase | Who pays | What it covers |
|---|---|---|
| During construction | Sharp Homes (builder’s risk) | The structure and materials while the home is being built |
| At closing and after | You (homeowners policy) | Your finished home and belongings once ownership transfers to you |
When Your Homeowners Policy Should Start
Your homeowners policy should be active as of your closing date. Lenders require proof of insurance before they will fund the loan, so you will typically need to have the policy bound and provide a declarations page a few days before closing.
Work backward from your target closing: get quotes a few weeks out, choose a policy, and have it set to take effect on the closing date. Confirm the exact timing and documentation your lender wants, since requirements vary.
- Get homeowners quotes a few weeks before your closing date
- Bind the policy with an effective date matching your closing
- Provide the declarations page to your lender before closing
- Avoid starting coverage while the builder’s risk policy is still in force (you would double-pay)
- Confirm your lender’s exact proof-of-insurance timeline
New Construction Can Mean Better Rates
There is a quiet upside here: brand-new homes are often cheaper to insure than older ones. New wiring, plumbing, roofing, and code-current construction lower the risk of claims, and many insurers reward that with lower premiums. When you gather quotes, ask specifically about new-construction discounts, and mention the build standards in your home.
How Sharp Homes Makes This Simple
Sharp Homes carries the builder’s risk coverage during construction, so you have nothing to insure until the home is yours. As you approach closing, our team keeps you informed on timing so you can line up your homeowners policy without scrambling. If you want, we can point you toward the documentation your lender will ask for so the handoff from our coverage to yours is clean. See the build process for how the timeline comes together.
Frequently Asked Questions
When should I get homeowners insurance on a new construction home?
Your homeowners policy should take effect on your closing date, when ownership transfers to you. During construction, Sharp Homes carries a builder’s risk policy, so you do not need your own coverage until closing.
Do I need insurance while my home is being built?
No. The builder carries builder’s risk insurance during construction. You do not need a homeowners policy until you take ownership at closing.
When does the lender need proof of insurance?
Lenders typically require proof of insurance, a declarations page, a few days before closing so they can fund the loan. Confirm your lender’s exact timeline.
Is a new construction home cheaper to insure?
Often, yes. New wiring, plumbing, roofing, and code-current construction lower claim risk, and many insurers offer new-construction discounts. Ask your agent when you gather quotes.
What happens if I start my policy too early?
You would overlap with the builder’s risk policy and pay for coverage on a home you cannot occupy yet. Set your effective date to your closing date instead.
Building Soon? We’ll Keep You Ahead of Closing
Planning a build and want a clear picture of the timeline, including when to line up insurance? Call 316-775-2129 or contact Sharp Homes and we will walk you through what happens and when. Most inquiries hear back within 24 to 48 hours.
